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Trusts to feel pressure as NHS funding rise slows

The Government's £20bn increase in NHS funding over the next three years has a sting in the tail for cash-strapped PCTs, health chiefs have warned.

As ministers stumped up the cash to pay for Lord Darzi's NHS Next Stage Review, the NHS Confederation said a demand for all PCTs to make 3% efficiency savings would pile pressure on trusts that have still not recovered from their massive financial problems.

Meanwhile the chief executive of the King's Fund, Niall Dickson, said the increase in spending would ‘feel like a cut', compared with large rises in funding in previous years.

Improving GP access was top of the health agenda in the Comprehensive Spending Review, which sets out the Government's spending priorities.

Some £250m will be set aside to fund the 150 new walk-in health centres and 100 new practices in areas with poor provision announced in Lord Darzi's interim review.

Overall spending on the NHS will increase by 4% a year above the rate of inflation, rising from £90bn this year to £110bn in 2010.

But the increase is smaller than in previous years. Since 2002 the health service has been given annual rises of over 7% above inflation. Mr Dickson said: ‘This spending review marks the end of a period of huge growth in health spending.'

The review also calls for ‘value for money savings' of at least £8.2bn, by improving procurement practices, reducing variations in productivity and changing the way health services are delivered.

Nigel Edwards, director of policy at the NHS Confederation, said: ‘Trusts will find the 3% efficiency saving target a real challenge, especially those that have recently emerged from financial deficit.'